Key think tank scales back outlook for 2014

%3CP%3E%3CFONT%20face%3DVerdana%3ECASS%20cuts%20GDP%20forecast%20to%207.3%25%2C%20citing%20the%20impact%20of%20downturn%20in%20property%20sector%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20Chinese%20Academy%20of%20Social%20Sciences%20on%20Friday%20lowered%20its%20forecast%20for%202014%20GDP%20growth%20to%207.3%20percent%2C%20one%20of%20many%20institutions%20that%20are%20paring%20back%20their%20economic%20expansion%20outlooks%20for%20the%20nation.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20CASS%20cut%20its%20forecast%20from%207.5%20percent%20to%207.4%20percent%20just%20a%20few%20months%20ago.%20The%20latest%20forecast%20could%20be%20instrumental%20in%20decisions%20taken%20by%20the%20Central%20Economic%20Work%20Conference%20in%20December%2C%20domestic%20media%20reports%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20CASS%20said%20in%20its%20quarterly%20analysis%20that%20the%20latest%20revision%20was%20prompted%20by%20the%20cooling%20real%20estate%20sector%20and%20its%20impact%20on%20investment%2C%20a%20pillar%20of%20the%20economy.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20growth%20in%20real%20estate%20investment%2C%20roughly%20accounting%20for%20one-quarter%20of%20China%27s%20investment%2C%20fell%20to%20a%20record%20low%20of%2013.2%20percent%20for%20the%20first%20eight%20months%20of%20the%20year%2C%20according%20to%20the%20National%20Bureau%20of%20Statistics.%20As%20a%20result%2C%20fixed-asset%20investment%20growth%20slumped%20to%20a%2014-year%20low%20of%2016.5%20percent%20in%20the%20same%20period.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3E%22Although%20the%20government%20has%20shored%20up%20investment%20in%20infrastructure%2C%20which%20we%20expect%20to%20grow%20more%20than%2020%20percent%20for%20the%20full%20year%2C%20that%20cannot%20offset%20the%20drag%20of%20property%20investment%20%22%2C%20the%20report%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3ECommenting%20on%20the%20other%20two%20engines%20of%20GDP%20growth%2C%20the%20report%20estimated%20that%20exports%20would%20not%20significantly%20improve%20because%20of%20slack%20external%20demand.%20Consumption%20would%20grow%20steadily%2C%20the%20report%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3ECASS%20Vice-President%20Li%20Yang%20said%20the%20most%20volatile%20factor%20in%20growth%20would%20be%20investment.%20Although%20investment%20growth%20had%20slowed%2C%20that%20also%20meant%20that%20wasteful%20investment%20could%20be%20constrained%20and%20overcapacity%20could%20be%20alleviated%2C%20he%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EEconomic%20growth%20%22has%20entered%20the%20%27new%20normal%27%2C%20which%20is%20a%20good%20thing%20judging%20by%20the%20sustainability%20of%20the%20economic%20growth%22%2C%20he%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20CASS%27%20latest%20assessment%20added%20to%20signs%20that%20the%20central%20government%20is%20increasingly%20comfortable%20with%20a%20more%20moderate%20growth%20level.%20During%20a%20State%20Council%20executive%20meeting%20on%20Wednesday%2C%20Premier%20Li%20Keqiang%20told%20the%20cabinet%20that%20the%20economy%20is%20%22running%20within%20a%20proper%20range%22.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EHe%20said%3A%20%22The%20outside%20world%20has%20a%20misunderstanding%20that%207.5%20percent%20growth%20is%20our%20lowest%20acceptable%20line.%20But%20I%27ve%20said%20that%20%27a%20bit%20higher%20or%20lower%20than%20that%20is%20OK%27%2C%20as%20long%20as%20employment%20and%20incomes%20are%20growing.%22%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20central%20bank%20said%20on%20Sunday%20that%20it%20will%20maintain%20its%20%22steady%22%20monetary%20policy%2C%20adding%20various%20monetary%20tools%20to%20maintain%20adequate%20liquidity%20.%20Analysts%20said%20the%20comment%20was%20signal%20that%20the%20bank%20will%20not%20resort%20to%20cutting%20interest%20rates%20or%20reserve%20requirement%20ratios%20as%20many%20investors%20had%20hoped.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThese%20signs%20have%20also%20increased%20the%20possibility%20that%20China%20could%20tolerate%20a%20lower%20growth%20rate%20of%207.4%20percent%20or%207.3%20percent%20for%20this%20year%2C%20and%20next%20year%27s%20target%20could%20be%20set%20lower%2C%20analysts%20said.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EWeak%20data%20for%20July%20and%20August%20have%20already%20prompted%20various%20financial%20institutions%20to%20lower%20their%20forecasts%20for%20the%20third%20quarter.%20The%20consensus%20among%20chief%20economists%20at%2020%20institutions%20stands%20at%207.2%20percent%2C%20according%20to%20a%20poll%20by%20China%20Business%20News.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThat%20would%20be%20the%20lowest%20quarterly%20growth%20since%20the%20first%20quarter%20of%202009.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThird-quarter%20GDP%20data%20will%20be%20released%20on%20Tuesday.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EOn%20Monday%2C%20the%20World%20Bank%20lowered%20its%20growth%20forecast%20for%20China%20to%207.4%20percent%20this%20year%20and%20to%207.2%20percent%20in%202015.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EThe%20International%20Monetary%20Fund%20retained%20its%202014%20economic%20growth%20outlook%20for%20China%20at%207.4%20percent%2C%20but%20it%20said%20that%20it%20expects%20GDP%20growth%20to%20fall%20to%207%20percent%20next%20year%20because%20of%20slow%20implementation%20of%20reforms%20and%20policies%20to%20limit%20local%20government%20debt%20and%20investment%20credits.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3EGary%20Hufbauer%2C%20a%20senior%20fellow%20at%20the%20Peterson%20Institute%20for%20International%20Economics%20in%20Washington%2C%20said%20he%20thought%20the%20IMF%20report%20was%20too%20optimistic.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3E%22I%20would%20tend%20to%20go%20for%20the%20downside.%20Exports%20are%20not%20doing%20particularly%20well%2C%22%20he%20told%20China%20Daily.%3C/FONT%3E%3C/P%3E%0D%0A%3CP%3E%3CFONT%20face%3DVerdana%3E%3CBR%3E%28China%20Economic%20Net%29%3CBR%3E%3C/FONT%3E%3C/P%3E